Commission Rates

The Commission Rates form stores the commission rates you charge your clients for payments received from debtors. Whenever you post a payment transaction, these settings are used to calculate commission charges.

Up to four commission rates may be set on the account. Breakdown settings enable you to apply separate commission rates to various types of transactions. Please see the Commission and Breakdown example at the end of this document for details.

Accessing And Setting Commission Rates

You can view commission rate settings from the Financial Detail form or from the Client Settings form, if you have set the rates at the Client level. You can also set a Commission Rate for a particular Transaction or a particular Transaction Type.

The Commission Rates form is accessed from the Client form by selecting the ADVANCED button to open the Client Settings form. It is recommended that you set the rate in the Client Settings form, if possible.

The Commission Rates form is accessed from the Debtor form by selecting the Rate field or by tabbing into the Rate field and pressing F2. Select the Commission tab when the Financial Detail form is displayed. You can set the rate at the Debtor level if you have different rates for Debtors belonging to the same Client.

When you view a Transaction Type or a Transaction, you will also see the Commission tab. It may already have values in it "inherited" from the Client or Debtor settings. You can set the rate here, if needed, for special types of payments.

Rate 1

Enter a percentage here. This is a fixed amount. It is the portion of the debtor's payment that your agency charges as a fee for services. The amount set here is displayed on the Debtor form in the Rate field. When a payment transaction is posted, the dollar amount of the a applicable commission is calculated using the percentage in this field. This amount is entered automatically into the transaction's Commission field.

This rate can be overridden for an individual transaction.

Enter a fixed commission amount here OR select a sliding scale rate plan in the Commission Rate Plan field.

Do not enter both a fixed rate and a rate plan. Use one or the other only.

Select the type of payment this rate is applied to by putting a check mark in the appropriate column next to this field.

Please refer to Commission and Breakdown below.

Rate 2

You can enter a percentage here if you need to charge a different commission rate for the breakdown type that is check marked for Rate 2.

Please refer to Commission and Breakdown below.

Rate 3

You can enter a percentage here if you need to charge a different commission rate for the breakdown type that is check marked for Rate 3.

Please refer to Commission and Breakdown below.

Rate 4

You can enter a percentage here if you need to charge a different commission rate for the breakdown type that is check marked for Rate 4.

Please refer to Commission and Breakdown below.

Principal

Select a Rate or Rates that you wish you apply to any portion of the Transaction that goes to Principal.

Please refer to Commission and Breakdown below.

Interest

Select a Rate or Rates that you wish you apply to any portion of the Transaction that goes to Interest.

Please refer to Commission and Breakdown below.

Fees

Select a Rate or Rates that you wish you apply to any portion of the Transaction that goes to Fees.

Please refer to Commission and Breakdown below.

Legal

Select a Rate or Rates that you wish you apply to any portion of the Transaction that goes to Legal.

Please refer to Commission and Breakdown below.

Misc

Select a Rate or Rates that you wish you apply to any portion of the Transaction that goes to Misc.

Please refer to Commission and Breakdown below.

Other

Select a Rate or Rates that you wish you apply to any portion of the Transaction that goes to Other.

Please refer to Commission and Breakdown below.

Rate Plan

Press F2 or select the down arrow next to this field to choose a Commission Rate Plan. The commission that is charged on the debtor's payments will be calculated based on the rates in the plan that you choose. The commission that applies currently is displayed on the Debtor form in the Rate field. When a payment transaction is posted, the dollar amount of the applicable commission is calculated using the rate chosen in this field. The actual commission amount is entered automatically into the transaction's Commission field.

Do not enter both a fixed rate and a rate plan. Use one or the other only.

Add Commission To Owing

When this switch is set, the Commission amount is added to the debtor's Owing. This switch is only visible in the Commission tab of the debtor's Financial Detail form.

Normally debtors cannot be charged the collection expenses. You can only check the box labeled 'Add commission to owing' if you have the legal right in your jurisdiction to charge the debtor for incurred collection expenses.

Collect! calculates the commission amount and creates a fee transaction with Transaction Type 399 debiting the commission amount from the debtor's account. Collect! uses the information from your Transaction Type 399 settings to determine how to calculate the fees. If this transaction type is not in the system, you are prompted to create it in your transaction types.

Please be aware that adding commission to owing alters the calculation of commission on each payment that is posted on the account.

When the Add Commission to Owing switch is ON, the calculation is

commission = payment X (rate/100) / (1.0 + (rate/100))

When the commission is not added to the owing, the default calculation is

commission = payment X rate/100

Basically, this is the logic:

If a Debtor owes you $100 and your commission rate is 30%, then the total owed is $130. But the commission
they owe you is still $30. So it is no longer 30% of the total. It is not 30% of $130. It is actually 23.08% of $130.

To find this figure you divide the Commission Owed by the Total Owed with the Commission added to it. - $30/$130.

Do not set this switch unless you have a signed agreement from the debtor on file, or you are sure the laws in your region permit you to charge the debtor collection fees.

Don't Calculate Commission

Switch this ON to prevent the calculation of commission for this transaction. This switch is visible only when you are viewing Transaction Type or Transaction form.

Set this switch BEFORE you enter your payment amount in the To Us or Direct fields. If you fail to do this, and you see an amount in the Commission Amount field, simply delete it to remove the calculated Commission.

Total

This is a summary calculation of all commission charged on this transaction. This field is visible only when you are viewing a Transaction.

Commission And Breakdown

Collect! enables you to calculate up to four commission rates in the Commission Rates settings. These rates may be applied to different categories of monies posted on the account. We will demonstrate all of Collect!'s settings.

Below is an example of a Debtor's Commission Rate settings using all the available settings, just to demonstrate how Collect! calculates commission with multiple rates and breakdown. You may not require this level of complexity in your commission calculations. Use only what you need.

Commission Rates Settings

For our example, this Debtor owes $210 posted in the following way. We have posted an amount to each one of Collect!'s Financial Types to demonstrate.

Debtor Screen with Transactions Posted

Next we ensure that the Financial Types breakdown order in the Transaction Type suits our demonstration's purposes. This order can be changed as needed in your use.

Transaction Type with Breakdown

Now, we post a payment for the entire amount, $210. Notice that Collect! has copied into the Transaction, all of the settings from the Debtor's Commission Rates. Collect! has also performed the calculations and has arrived at the total commission owing. We see all the rates and the commission amounts.

Payment Posted with Commission Calculated

When we select the Breakdown tab in the payment we just entered, we see the totals for each category. We see the dollar amount for each Financial Type and the commission amounts.

Amount Posted to Each Financial Type

This short example shows you the impressive amount of flexibility Collect! offers for managing your accounts and calculating your commissions.

See Also

- Financial Detail